Simplex Castings advances Green Energy Transition with 25-Year Solar Power Agreement

Simplex Castings Limited (BSE: 513472), India's leading precision metallurgy and casting solutions company, has entered into a 25-year Power Purchase Agreement (PPA) with M/s Natraj Energy, a Raipur-based renewable energy partnership firm, for the supply of clean energy through a captive solar power project under the LongTerm Open Access (LTOA) mechanism in the State of Chhattisgarh.

Under the agreement, Natraj Energy will develop, own, operate and maintain a 5.5 MWp gridconnected solar power plant, which will supply renewable electricity to Simplex Castings' manufacturing facilities at Bhilai and Tedesara through the open-access captive consumption mechanism.

The transition to solar power is going to deliver annual energy cost savings of close to ₹2.16 Crores, representing a significant improvement in the Company's cost structure over the life of the agreement. Prior to this arrangement, the Company was sourcing power at ₹9 per unit from the conventional grid. Under the new solar power agreement, Simplex Castings is expected to achieve a saving of close to ₹3 per unit, effectively bringing its net energy cost down to ₹5-6 per unit for the same consumption pattern.

The arrangement has been structured on a cash-neutral basis, enabling the Company to participate in the project economics without material upfront capital outlay.

Natraj Energy will assume full responsibility for project development, statutory and regulatory approvals, grid connectivity, long-term open access arrangements, and operations and maintenance of the solar facility throughout the 25-year term. The agreement incorporates robust performance and payment security mechanisms to ensure reliable energy supply to the Company.

Commenting on the development, Mr. Ketan Shah, Chairman and Executive Director said: stated: "This long-term solar power arrangement marks a significant step in Simplex Castings' sustainability journey. By securing clean energy at a predictable tariff over a 25-year horizon, we are simultaneously strengthening our commitment to responsible manufacturing and meaningfully improving our energy cost structure. The annual savings of approximately ₹2Crores reflect the tangible financial value of this initiative which adds to our margins, alongside its environmental benefits. We look forward to a productive partnership with Natraj Energy as we work towards a cleaner and more efficient future."

Shares of SIMPLEX CASTINGS LTD. was last trading in BSE at Rs. 477.45 as compared to the previous close of Rs. 479.20. The total number of shares traded during the day was 9042 in over 231 trades.

The stock hit an intraday high of Rs. 494.95 and intraday low of 463.30. The net turnover during the day was Rs. 4331984.00.

Source : Equity Bulls

Keywords

SIMPLEXCASTINGS INE658D01011 GreenEnergy SolarPowerAgreement